Baofeng president detained by police
Baofeng Group Co, which offers smart TV and media playing services, said its president and owner Feng Xin has been detained by police for “suspected crimes” in a statement released by the Shenzhen-listed firm on Monday.
When it made its debut on the domestic stock market in 2015, Baofeng's share price surged to 327.1 yuan (US$48) from an IPO price of 7.14 yuan in several months.
On Monday, its share price fell 10 percent to 5.67 yuan, compared with the ChiNext market's 0.30 percent gain.
The statement didn't give any details of the case but it is thought to relate to a merger and acquisition in 2016.
That year, Baofeng said it was paying 5.2 billion yuan to acquire international sports marketing and media rights firm MP&Silva, which used to own many international broadcasting rights for soccer and other sports. But MP&Silva went bankrupt two years later.
Baofeng was then sued by a subsidiary of China Everbright Group, which funded the acquisition, according to media reports.
The unsuccessful acquisition was one example of Baofeng's aggressive expansion in the so-called DT domain, referring to data and technology. It has invested heavily in sports, virtual reality and smart TV businesses but they have all met with a lukewarm market response.
In the first half, Baofeng expected to lose 230 to 235 million yuan, following a loss of 1.09 billion in 2018, according to its reports.
